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How to Make Profits in Contract Warehousing Without Storage

One way of transloading requires the unloading and staging of cargo shipped by rail.

There are two types of profit generating activities in contractl warehousing that do not require storage. The first type is called transloading, or moving merchandise from one mode of transportation to another. The second type of warehousing that eliminates storage is called cross docking.

In contract warehousing, cross docking is a process where freight moves in and out of the warehouse without ever being stored. The three most important ingredients for cross docking are time, accuracy and communication. Supplying a shipping notice in advance of the load arrival speeds up the processing of the order. Failing to submit an advance notice can wipe out the cost advantage of cross docking.

Communication is as important as timeliness when cross docking. The operator needs to know what items are incoming, how they are sorted, when they are arriving and when they need to be shipped. Accuracy is done by the operator, who is also responsible for keeping track of the work performed in contract warehousing.

In contract warehousing, transloading is accomplished in one of three ways. The first way transloading is accomplished by the unloading and staging of cargo shipped by rail. The cargo is unloaded from rail cars into trucks for deliveries. Sometimes unloaded cargo is held for pick up by customers.

In public warehousing, cross docking is a process where freight moves in and out of the warehouse without ever being stored.

Another example of transloading is the transfer of intermodal container to truck. Marine containers are often too heavy for area roads. According to Wikipedia, “Intermodal containers are used to store and move materials and products in the global containerized intermodal freight transportation system efficiently and securely.” [1]

The final method of transloading is often referred to as pool distribution. Pool distribution merges many small orders together into a single truckload or less than truckload, which is often referred to as LTL shipping.

FW Warehousing is headquartered in St. Louis, Missouri with Midwest warehouse distribution centers in Kansas City, Indianapolis and St. Louis totaling more than four million square feet. Founded in 1949 with a focus on food-grade storage, FW later broadened its services to include contract warehousing, dry storage, hazardous material and chemical storage, temperature-controlled storage, product distribution and B2B and B2C fulfillment.

FW Warehousing has more than 50 years of experience in third-party 3PL logistics and has been ranked in the top 100 Third Party Logistic Companies in the country by Inbound Logistics magazine.

For more information about FW Warehousing and its complete warehousing, fulfillment and logistics capabilities, visit the FW Warehousing website.